India’s foreign trade policy took a sudden and significant turn on August 3, with the Commerce and Industry Ministry imposing restrictions on imports of laptops, PCs, tablets, and servers. Importers now need licenses due to security concerns and to encourage local production. The abrupt implementation caused supply chain disruptions and fears of shortages and price hikes before the festive season. The government later postponed the restrictions until November 1, aiming to streamline license approvals. This move, reminiscent of India’s early IT industry days, raises questions about import justifications and licensing criteria. While security concerns about imports from China can be addressed through testing norms, forcing global companies to invest might prove challenging. Such policies could negatively impact consumers, hindering access to digital services. Coupled with other recent policy decisions, this move creates uncertainty for investors and jeopardizes India’s reform progress.
